TD Points, Definition

A TD Point high of level K is a high which is strictly grater than the highs of the K preceding and K following bars. Similarly, a TD Point low of level K is strictly less than the lows of the K preceding and K following bars. (Gaps are not counted in making this determination.) Note that the level number of a recent high or low may not be finally determinable until more bars are obtained; a high or low N bars back from the present cannot now be labeled as having a level more than N, but it may later be given a higher number. Similarly, the level of a bar near the start of the available data may be uncertain. Either chart or “true” highs and lows can be used to determine TD Points; the latter effectively means that a high or low is a level K TD Point only if it is greater than or less than the close of the K+1'st prior bar. (A strict application of the definition of true high/low would mean that a bar that closes at its high/low cannot be a TD Point because the next bar's true high or low is at least equal to that close.)